On 1 January 2023, Martini Ltd bought a machine for \($218\) 000 cash; its useful life was 12 years and its residual value was \($26\) 000. It was decided to depreciate the machine by the straight-line method. On 30 September 2025, the machine was traded in to Lowe Ltd for a new model, the total cost being \($160\) 000. Lowe Ltd allowed \($120\) 000 for the old machine. It was decided to depreciate the new machine at the rate of 10% p.a. by the diminishing-balance method. Residual value of the new machine was \($14\) 000.

On 1 July 2026, Martini Ltd decided to adopt the revaluation model and revalue its machine upwards to reflect fair values. This represented a 15% increase in the carrying amount of the machine. The diminishing-balance method of depreciation was continued at the same rate. The accounting period ended on 30 June each year. At 30 June 2027, the carrying amount of the machine was approximately equal to fair value.

Required

(a) Prepare relevant ledger accounts to record the transactions up to 30 June 2027. Ignore GST.

(b) Show how the asset would appear in the financial statements of Martini Ltd as at 30 June 2024, 30 June 2026 and 30 June 2027.

(c) Show the Machinery account and Accumulated Depreciation – Machinery account if the revaluation on 1 July 2026 had been downwards instead of upwards.